Vending machine contract.is it legal??

[newmoses]

NOT SURE IF THIS IS THE CORRECT CATEGORY, SO mODS, PLEASE MOVE IF NECESSARY........The social club where i work have been renting 4 vending machines,hot drinks, snacks etc.There have been endless problems with maintenance, cleaniness, breakdowns, no change etc,so the committee decided to change companies.

However,the contract the social club have got is they think,,suspect, even though they have to give 3 months notice in writing to quit, because the signatory,Stephen White alleged himself to be an acting secretary, when he has never had that position.The contract is not dated by the signatory, nor the company owner.

The committee believe there should have been 2 signatories like chairperson and treasurer, or treasurer and secretary etc.

As the signatory had no legal standing to sign and declare a position, the committee are wondering if this contract is actually legal.If it is not, can someone with knowledge please state why??Many Thanks

Edited March 17, 2016 by citizenB
image showing personal details

[honeybee13]

newmoses, you need to paint out personal details on the attachment and repost it, asap please.

 

HB

[BazzaS]

NOT SURE IF THIS IS THE CORRECT CATEGORY, SO mODS, PLEASE MOVE IF NECESSARY........The social club where i work have been renting 4 vending machines,hot drinks, snacks etc.There have been endless problems with maintenance, cleaniness, breakdowns, no change etc,so the committee decided to change companies.

However,the contract the social club have got is they think,,suspect, even though they have to give 3 months notice in writing to quit, because the signatory,Stephen White alleged himself to be an acting secretary, when he has never had that position.The contract is not dated by the signatory, nor the company owner.

The committee believe there should have been 2 signatories like chairperson and treasurer, or treasurer and secretary etc.

As the signatory had no legal standing to sign and declare a position, the committee are wondering if this contract is actually legal.If it is not, can someone with knowledge please state why??Many Thanks.[

 

There are a few key issues

1) Was there ever a contract?

2) if there was, are the terms of that contract unfair

3) if the contract is enforceable : do any failings by the rental company (breakdowns, no change) count as a breach of contract.

 

Let us take these in reverse:

3) what does the paperwork say about breakdowns, failure to provide change and other "service failures"?

There may be "express terms" stated in the paperwork. If not, there is an implied term that the service must be of reasonable quality and fit for purpose. If all else fails tell them they have breached the contract on these grounds.

 

2) if it is a contract, then it is a contract between a social

Club and a business.

It is more likely to be viewed as a contract between a business and a business than as a "consumer" contract. As such it will be harder for you to claim the terms are unfair (and thus void under UCTA 1977)

 

1) is it a valid contract? For there to be a valid contract there must be "offer, acceptance, consideration and intent to create contractual relations"

A) Consideration : the rental firm will likely claim the consideration due to them is the profit they make on the drinks sold, The rental cost is zero, so you'll claim there is no consideration, and thus : no contract.

If you tell them "come pick your machines up" they may try and claim for 3 months profit, and you'll want to offer them 3 months rent (nil)!

 

B) Parties bound by the contract : you'll want to say the person signing it had no power to bind the social club, and so the social club can't be held to any contract.

If you are saying the person signing it never had "actual authority" to do so, then it will hinge on if they had "apparent authority"

Did they hold themselves out to the rental company as having authority to sign a contract acting as an agent for the social club?

If so, was it reasonable (given all the circumstances....) for the rental company to have relied on that.

 

Personally, (unless there are any more relevant terms, say on the back of that sheet or on another sheet) : I'd say "here, have 3 months rental" (nothing!) "in lieu of notice, in case any notice is due, but if your company had undertaken due diligence you'd have known the person signing the agreement had no authority to do so, so there isn't actually a contract.

If your position is that there was a contract and you are owed damages if we void it here and now, all of the above apply AND we'd claim that IF there was a contract the prior breach of it by lack of reasonable quality / fitness of purpose brought it to an end (with no damages due to you) even before now"!

[BazzaS]

Personally, (unless there are any more relevant terms, say on the back of that sheet or on another sheet) : I'd say "here, have 3 months rental" (nothing!) "in lieu of notice, in case any notice is due, but if your company had undertaken due diligence you'd have known the person signing the agreement had no authority to do so, so there isn't actually a contract.

If your position is that there was a contract and you are owed damages if we void it here and now, all of the above apply AND we'd claim that IF there was a contract the prior breach of it by lack of reasonable quality / fitness of purpose brought it to an end (with no damages due to you) even before now"!

 

Possible fly in the ointment : that agreement is dated May 2012.

 

If the social club were unhappy they have had close to 4 years to deal with it : they may have affirmed there being a contract by continuing to use / allow use of the machines for 3+ years.

 

You might still use the "no consideration"'argument, or the "here, have 3 months rent" approaches, and also the "breach of contract through unreliability" aspect : has/have there been documented complaint(s) to the rental company?

[citizenB]

I have removed the image in post one - please repost after editing personal details and signatures.

[newmoses]

Here is both sides of the contract.

[honeybee13]

Sorry, NM, you've still got people's names and signatures on that.

 

HB

[steampowered]

I don't think you'll have a get-out because of who signed the contract, I'm afraid. An internal rule that there must be two signatories cannot be relied on to evade contracts, unless the third party vending machine company was given notice of that requirement prior to signature.

 

On the acting secretary issue, anyone who has 'apparent authority' will be able to bind the club. This means was it reasonable for a third party to assume that this person had authority to sign? I'd think most people holding some sort of official role will have 'apparent authority' to sign a vending machine contract.

 

Even if this person did not have signing authority, as you have had the vending machines for nearly 3 years I think the club would be seen to have affirmed the contract and would not be allowed to void the contract at this stage. If a club wants to evade a contract due to lack of signing authority it is expected to raise the issue as soon as it finds out about the contract.

 

The contract is a bit of a mess. The front page of the contract suggests this is a rolling 12 month contract which can be terminated by giving notice 3 months before an annual renewal. As the contract is dated 1 May, you have missed the window for giving notice in 2016. The next possible expiry date would be 1 May 2017 (and you would need to give your termination notice 3 months before then). The T&Cs attached to the contract contradict the front page though, as they say you can give 3 months notice anytime after the minimum period has expired.

 

Aside from what is mentioned in the T&Cs, the law allows you to terminate contracts if the other side has breached the contract in a fundamental manner. The T&Cs state that the company is required to maintain and stock the machines. If the company has consistently failed to do this, despite being requested to do so by the club in writing or by email, then it sounds to me like you could probably terminate the contract immediately for breach of contract - just say that the company has seriously breached its contract, state what those breaches are, and state that you are now terminating the arrangement for breach of contract and request collection of the machines at the earliest possible opportunity. It would be safer to give the company 'one last chance' - i.e. tell them what they need to fix and tell them that the contract will be terminated for breach of contract if the issues are not fixed within a reasonable time frame (say 14 days).